SEMINAR REPORT ON

WORLD TRADE ORGANISATION (WTO)

SUBMITTED TO Mr. Liaqat Ali Khan

SUBMITTED BY Tanveer Singh Roll No. 5395 MBA 2nd Semester Section- E

SESSION 2011-2012 SCHOOL OF MANAGEMENT STUDIES PUNJABI UNIVERSITY, PATIALA

ACKNOWLEDGEMENT

I would like to take this opportunity to thank Mr. Liaqat Ali Khan, Lecturer, MBA Department, School of management studies, Punjabi university, Patiala, who has been guiding force for my Report on CHANGING (WTO). I am also thankful to my friends, for their support and encouragement in finding out the appropriate material for this Report, without them making this report would have been impossible. ROLE OF WORLD TRADE ORGANISATION

Tanveer Singh Roll No. 5395 MBA 2nd Semester, Sec: E

CHANGING ROLE OF WORLD TRADE ORGANIZATION

WTO founder members (January 1, 1995) subsequent members

WTO

Formation Headquarters

January 1, 1995 Centre William Rappard, Geneva,

Switzerland Membership 153 member states Official languages English, French, Spanish Director-General Pascal Lamy 189 million Swiss francs (approx. Budget 182 million USD) in 2009. Staff 625 Website www.wto.int

Location of the WTO headquarters in Geneva

WHAT IS THE WTO? ONE OPINION:

The World Trade Organization (WTO) is the only global international organization dealing with the rules of trade between nations.WTO agreements are negotiated and signed by the trading nations and ratified in their parliaments. The goal is to help producers of goods and services, exporters and importers conduct and grow their business. The goal of WTO is to improve the welfare peoples of the member countries. The Ranking of India is 16th in World Trade Organization.

ORIGIN OF WTO General agreements of tariffs and trade (GATT) which was established in 1947 as a forum to reduce trade barriers. WTO replaced GATT in 1995 as legal and institutional foundation of multilateral trade relations. It designed to strengthen the trade rules by providing a stronger set of institutions for resolving disputes and enforcing agreements. In WTO negotiations take place in rounds. There have been 9 to date. Begins with an agreement among members on agenda. Most recent completed round was Uruguay round. The negotiations are continued in Doha round.

STRUCTURE OF WTO:
-Ministerial conference polices and strategy making body. -General council executive body of WTO disputes settlement and trade related policy. - Councils- trade in goods, trade in services and trade related aspects of intellectual property body. -Committees and management bodies- committees on trade and development, balance of payment and budget, finance and administration. -The WTO has 153 members, accounting for over 97% of world trade. Around 30 others are negotiating membership. The WTOs top level decision making body is the ministerial conference which meets at least once every two years. Below this is the general council (normally ambassadors and heads of delegation in Geneva, but sometimes official sent from members capitals) which meets several times a year in Geneva headquarters. The general council also meets as the trade policy review body and the dispute settlement body.

At the next level, the GOOD COUNCIL, SERVICES COUNCIL, & INTELLECTUAL PROPETRY (TRIPS) COUNCIL, report to general council. numerous specialized committees, working groups and working parties deal with the individual agreements and other areas such as environments, development membership applications and regional trade agreements.

GATT (a treaty and an organization)

The general trade agreements on trade and tariff was first signed in 1947 ,it was designed to provide an international forum that encouraged free trade between member states by regulating and reducing tariffs on traded goods and also providing common mechanism for resolving trade disputes. GATT was the outcome of the failure of negotiating governments to create ITO The Breton woods conference introduced the idea for an organization to regulate trade as part of larger plan for economic recovery after World War IIAs governments negotiated the ITO, 15 negotiating states began parallel negotiations for the GATT as a way to attain early tariff reductions. Once the ITO failed in 1950 only the GATT agreements was left. The GATT main objective was the reduction of barriers to international trade. This was achieved through the reduction of trade barriers, quantitative restrictions, subsides on trade through a serious of agreements,

HISTORY OF GATT
First phase: from 1947 until torque round (commodities which would be covered by the agreement and freezing existing tariff levels. Year 1947 1949 1951 Place/name Geneva Annecy Torque Subjects covered Tariffs Tariffs Tariffs

Second phase: encompassing three rounds from 1959 to 1979(focused on reducing tariffs) Year Place/name 1960-1961 Geneva (dillion round) 1964-1967 Geneva Kennedy 1973-1979 round Geneva Tokyo round Subjects covered Tariff Tariff and anti dumping measures Tariff and non tariffs measures, framework agreements.

Third phase: consisting only the Uruguay round from 1986 to 1994 Extended the agreement fully to new areas such as intellectual property, services, capital and agriculutre.out of this round WTO was born. Year 19861 9 9 4 Place/name Geneva Uruguay round Subjects covered Tariffs, non tariffs measures, rules, services, intellectual property, dispute settlement, textiles, agriculture, creation of WTO etc.

DID GATT SUCCED

Continual reductions in tariffs helped spur very high rates of world trade growth during the 1950s and 1960s around 8% a year on average. Trade growth consistently outpaced production growth. The rush of new members during the Uruguay round demonstrated recognition of multilateral tiding system as the anchor for development and an instrument of economic and trade reform. But GATT sauced in reducing the tariffs it a low level with a series of economic recessions 1970s & 80s drove governments to devise other form of protection for sectors facing increased foreign competition. High rates of unemployment and constant factory closures led governments in Western Europe and North America to seek bilateral marketing sharing arrangements with competitors and to embark on subsidies race to maintain their hold on agricultural trade. Both these changes undermined GATT; s credibility and effectiveness.

The problem was not just deteriorating trade policy environment. By the early 1980s the general agreement was clearly no loger as relevant to the realities of the world trade as it had been in 1940s. World trdadehas become far more complex and important than 40 year before. The globalization of the economy was under way. Trade in services- not covered by GATT rules Ever increasing international investments. Factors convinced GATT members that anew effort to reinforce and extend the multilateral system should be attempted. That effort resulted in the Uruguay round the Marrakesh declaration and the creation of the WTO.

Uruguay Round
It took seven and a half years, almost twice the original schedule. By the end, 123 countries were taking part. It covered almost all trade, from tooth brushes to pleasure boats, from banking to telecommunications from the genes of the wild rice to AIDS treatments. It was quite simply the largest trade negotiation ever and most probably the largest negotiation of any in history.

The agreements fall into a structure with six main parts:

The Agreement Establishing the WTO Goods and investment the Multilateral Agreements on Trade in Goods including the GATT 1994 and the Trade Related Investment Measures Services the General Agreement on Trade in Services Intellectual property the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) Dispute settlement (DSU) Reviews of governments' trade policies (TPRM)

Ministerial conferences

First ministerial conference The inaugural ministerial conference was held in Singapore in 1996. Disagreements between largely developed and developing economies emerged during this conference over four issues initiated by this conference, which led to them being collectively referred to as the "Singapore issues". Second ministerial conference It was held in Geneva in Switzerland. Third ministerial conference The third conference in Seattle, Washington ended in failure, with massive demonstrations and police and National Guard crowd control efforts drawing worldwide attention. Fourth ministerial conference It was held in Doha In Persian Gulf nation of Qatar. The Doha Development Round was launched at the conference. The conference also approved the joining of China, which became the 143rd member to join. Fifth ministerial conference The ministerial conference was held in Cancun, Mexico, aiming at forging agreement on the Doha round. An alliance of 22 southern states, the G20 developing nations (led by India, China and Brazil), resisted demands from the North for agreements on the so-called "Singapore issues" and called for an end to agricultural subsidies within the EU and the US. The talks broke down without progress. Sixth ministerial conference The sixth WTO ministerial conference was held in Hong Kong from 13 December 18 December 2005. It was considered vital if the four-year-old Doha Development Agenda negotiations were to move forward sufficiently to conclude the round in 2006. In this

meeting, countries agreed to phase out all their agricultural export subsidies by the end of 2013, and terminate any cotton export subsidies by the end of 2006. Further concessions to developing countries included an agreement to introduce duty free, tariff free access for goods from the Least Developed Countries, following the Everything But Arms initiative of the European Union but with up to 3% of tariff lines exempted. Other major issues were left for further negotiation to be completed by the end of 2010 Seventh ministerial conference The WTO General Council, on 26 May 2009, agreed to hold a seventh WTO ministerial conference session in Geneva from 30 NovemberDecember 2009. A statement by chairman Amb. Mario Matus acknowledged that the prime purpose was to remedy a breach of protocol requiring two-yearly "regular" meetings, which had lapsed with the Doha Round failure in 2005, and that the "scaled-down" meeting would not be a negotiating session, but "emphasis will be on transparency and open discussion rather than on small group processes and informal negotiating structures".

Doha Round

THE DOHA ROUND of WTO negotiations began in November 2001. The new round was instead launch at, ministerial conference in Doha Qatar. The new trade agenda of developed world was dubbed the Doha development agenda and from there, all countries were committed to negotiations opening agricultural and manufacturing markets, as well as trade in services (GATS) negotiations and expanded intellectual property regulation (TRIPS). The intent of the round, according to its proponents was to make trade rules fairer for developing countries. Opponents changed that the round would expand a system o f trade rules that were bad for development and interfered excessively with countries; domestic policy space. The round was set to be concluded in four years in December 2005- after two more ministerial conferences has produced a final draft declaration. Agriculture has a become the linchpin of the agenda for both developing and developed countries, compulsory licensing of medicines and patent protection. A second deals with a review of previsions giving special and differential treatment to developing countries & addressing Problems that developing countries are having in implementing current trade obligations. A Study by the University of Michigan found that if all trade barriers in agriculture, service, and manufacturers were reduced by 33% has result of the Doha development agenda; there would be an increase in global welfare of $ 574.0 billion. Some studies present moir modest outcome predicting world net welfare gains ranging from $ 84 billion to $ 287 billion by the year 2015 others up to $ 3000 billion per year.

GATT and WTO trade rounds Name 1. Geneva start April 1947 Duration 7mths Countries 23 Sub. Covered Tariffs achievements Signing of GATT, 45,000 tariffs concession affecting $10 2.annecy April 1949 5mtnhs 13 Tariffs billion of trade. Countries exchanged some 5000 tariff 3.torquay Sept,1990 8months 38 Tariffs concessions Countries exchanged some 87000 tariffs concessions ,cutting 4.genevaII 5.dillion Jan.1956 5months 26 26 Tariff admission of Japan tariffs the tariff by 25% $ 2.5 billion in tariff reduction Tariff concession worth $4.9 billion 6.kennedy May 1964 7.tokyo Sept 1973 37 months 74 months 102 Tariff, non tariff measures frameworks 62 Tariffs & anti dumping of world trade. Tariff concession worth $ 40 billion of world trade Tariff reduction worth $190

Sept 1960 11months

8.uruguay

Sept 1986

87 months

123

agreements Tariffs, non tariffs, rules services IP,DI,SPUTE,settlement, TEXTILES agriculture

reduction achieved Creation of WTO and extend the range of trade and negotiation .leading to thaw reduction in tariffs (about 40%)

Principles of the trading system

The WTO establishes a framework for trade policies; it does not define or specify outcomes. That is, it is concerned with setting the rules of the trade policy games. Five principles are of particular importance in understanding both the pre-1994 GATT and the WTO: 1. Non-Discrimination. It has two major components: the most favored nation (MFN) rule, and the national treatment policy. Both are embedded in the main WTO rules on goods, services, and intellectual property, but their precise scope and nature differ across these areas. The MFN rule requires that a WTO member must apply the same conditions on all trade with other WTO members, i.e. a WTO member has to grant the most favorable conditions under which it allows trade in a certain product type to all other WTO members. "Grant someone a special favor and you have to do the same for all other WTO members." National treatment means that imported and locally-produced goods should be treated equally (at least after the foreign goods have entered the market) and was introduced to tackle nontariff barriers to trade (e.g. technical standards, security standards et al. discriminating against imported goods). 2. Reciprocity. It reflects both a desire to limit the scope of free-riding that may arise because of the MFN rule, and a desire to obtain better access to foreign markets. A related point is that for a nation to negotiate, it is necessary that the gain from doing

so be greater than the gain available from unilateral liberalization; reciprocal concessions intend to ensure that such gains will materialize. 3. Binding and enforceable commitments. The tariff commitments made by WTO members in a multilateral trade negotiation and on accession are enumerated in a schedule (list) of concessions. These schedules establish "ceiling bindings": a country can change its bindings, but only after negotiating with its trading partners, which could mean compensating them for loss of trade. If satisfaction is not obtained, the complaining country may invoke the WTO dispute settlement procedures. 4. Transparency. The WTO members are required to publish their trade regulations, to maintain institutions allowing for the review of administrative decisions affecting trade, to respond to requests for information by other members, and to notify changes in trade policies to the WTO. These internal transparency requirements are supplemented and facilitated by periodic country-specific reports (trade policy reviews) through the Trade Policy Review Mechanism (TPRM). The WTO system tries also to improve predictability and stability, discouraging the use of quotas and other measures used to set limits on quantities of imports. 5. Safety valves. In specific circumstances, governments are able to restrict trade. There are three types of provisions in this direction: articles allowing for the use of trade measures to attain noneconomic objectives; articles aimed at ensuring "fair competition"; and provisions permitting intervention in trade for economic reasons. Exceptions to the MFN principle also allow for preferential treatment of developing countries, regional free trade areas and customs unions.

Voting system
The WTO operates on a one country, one vote system, but actual votes have never been taken. Decision making is generally by consensus, and relative market size is the primary source of bargaining power. The advantage of consensus decision-making is that it

encourages efforts to find the most widely acceptable decision. Main disadvantages include large time requirements and many rounds of negotiation to develop a consensus decision, and the tendency for final agreements to use ambiguous language on contentious points that makes future interpretation of treaties difficult. In reality, WTO negotiations proceed not by consensus of all members, but by a process of informal negotiations between small groups of countries. Such negotiations are often called "Green Room" negotiations (after the color of the WTO Director-General's Office in Geneva), or "Mini-Ministerial", when they occur in other countries. These processes have been regularly criticized by many of the WTO's developing country members which are often totally excluded from the negotiations. Richard Harold Steinberg (2002) argues that although the WTO's consensus governance model provides law-based initial bargaining, trading rounds close through power-based bargaining favoring Europe and the United States, and may not lead to Pareto improvement.

Dispute settlement
Dispute settlement is regarded by the WTO as the central pillar of the multilateral trading system. And as a unique contribution of the stability of global economy. WTO member has agreed that if they believe fellow members are violating trade rules they will use the multilateral system of settling disputes instead of taking actions unilaterally. The operation of the WTO dispute settlement process involves the DSB Panels, the appellate body, the WTO sectarian, arbitrators, independent export and several specialized institutions. Example:WTO on 28th October 2011 issued the report of the panel that had examined chinas Complaint in case European-Union Antidumping measures on certain features from china. Registrations begin for public observation of appeal in Boeing dispute:-

At the Request of the participants in the dispute United States Measures affecting trade in large civil aircraft. The Division hearing the appeal has decided to authorize public observation of the oral hearing on 18th October 2011.

Accession and membership

Country wishing to joins submits an application to the general council and has to describe all aspects of trade and economic policies that have a bearing on WTO agreements. Application is examined by working party opened to all in tested WTO members. The working party determines the terms and conditions of entry into the WTO for the applicant nations. Final phase-bilateral negotiations between the applicant nations and other member countries regarding the concession and commitments on tariff level and market access for goods and services. After talks working party sends to the ministerial conference on accession package. Once the general council or the ministerial conference approves of the terms of accession the applicants parliament must ratify the protocol of accession before it can become a member.

Agreements
The WTO oversees about 60 different agreements which have the status of international legal texts. Member countries must sign and ratify all WTO agreements on accession. A discussion of some of the most important agreements follows. Agreement on Agriculture (AoA) The Agreement on Agriculture came into effect with the establishment of the WTO at the beginning of 1995. The AoA has three central concepts, or "pillars": domestic support, market access and export subsidies. General Agreement on Trade in Services (GATS)

The General Agreement on Trade in Services was created to extend the multilateral trading system to service sector, in the same way the General Agreement on Tariffs and Trade (GATT) provides such a system for merchandise trade. The Agreement entered into force in January 1995 Trade-Related Aspects of Intellectual Property Rights Agreement (TRIPs) The Agreement on Trade-Related Aspects of Intellectual Property Rights sets down minimum standards for many forms of intellectual property (IP) regulation. It was negotiated at the end of the Uruguay Round of the General Agreement on Tariffs and Trade (GATT) in 1994.At the time that negotiation began, over 40 countries in the world did not grant patent. The trips agreement now requires all WTO members, with few exactions, to adapt their laws to the minimum standards of pier protecting for pharmaceutical product. Sanitary and Phyto-Sanitary (SPS) Agreement The Agreement on the Application of Sanitary and Phytosanitary Measures- also known as the SPS Agreement was negotiated during the Uruguay Round of the General Agreement on Tariffs and Trade, and entered into force with the establishment of the WTO at the beginning of 1995.

Under the SPS agreement, the WTO sets constraints on members' policies relating to food safety (bacterial contaminants, pesticides, inspection and labeling) as well as animal and plant health (imported pests and diseases).
Agreement on Technical Barriers to Trade (TBT)

The Agreement on Technical Barriers to Trade is an international treaty of the World Trade Organization. It was negotiated during the Uruguay Round of the General Agreement on Tariffs and Trade, and entered into force with the establishment of the WTO at the end of 1994. The object ensures that technical negotiations and standards, as well as testing and certification procedures, do not create unnecessary obstacles to trade". Multi fiber agreement (MFA) International trade agreement under which two countries may negotiate quota restrictions on textile and apparel imports from each other.MFA restrictions are normally prohibited under world trade organization (WTO) rules band must have been phased out by 2005. Multi fiber agreement (MFA) this agreement is dismantled with effect from Jan 1, 05 .resulting of removal of QR on the textile exports in several European countries. As a consequence a huge textile market is opened up for developing countries.

SCOPE OF WTO
Four Basic Rules 1. Protection to Domestic Industry Through Tariffs: a. The General Agreement on Tariffs and Trade (GATT) covers international trade in goods. The workings of the GATT agreement are the responsibility of the Council for Trade in Goods (Goods Council) which is made up of representatives from all WTO

member countries. GATT requires the member countries to protect their domestic industry/production through tariffs only. b. It prohibits the use of quantitative restrictions, except in a limited number of situations. 2. Binding of Tariffs: The member countries are urged to a. Eliminate protection to domestic industry/ production by reducing tariffs and removing other barriers to trade in multilateral trade negotiations. b. The reduced tariffs are bound against further increases by listing them in each country's national schedule. c. The schedules are an integrated part of the GATT legal system. 3. Most Favored-Nation (MFN) Treatment: a. The rule lays down the principles of non-discrimination amongst member countries. b. Tariff and other regulations should be applied to imported or exported goods without discrimination among countries. c. Exceptions to the rules i.e., regional arrangements subjected to preferential or duty free trade agreements, Generalized System of Preferences (GSP) where developed countries apply preferential or duty free rates to imports from developing countries. 4. National Treatment Rule: The rule prohibits member countries from discriminating between imported products and domestically produced like goods in the matter of internal taxes and in the application of internal regulations.

FUNCTIONS OF WTO:
WTO shall facilitate the implementation, administration and operation of the plurilateral trade agreement.WTO shall proved a forum for the negotiations

and its members and concerning their multilateral trade relation.wto shall administer the understanding on rules and procedures governing the settlement of disputes.WTO Shall administer the trade policy review mechanism and WTO shall cooperates as appropriate with IMF and IBRD and with the affiliated agencies. WTO administers the 28 agreements contained in final act and the no. of the plurilateral agreements and governments procurements through various councils and committee. Its oversees the implementation of issues related to tariffs cut and nontariff measure and agreed to in the trade negotiations. It examines the trade regimes of the individual member countries, WTO provided dispute settlement courts and panel. It acts as management consultant for world trade. It provide technical cooperation and training, it can be used as forum for the continuous negotiations. It cooperates with the international institution like IMF IBRS etc for maki9ng global economic policies and it oversees the national trade policies of the member governments. The goal behind these functions is set out in preamble to Marrakesh agreement these include: Raising standards of living Ensuring full employment Ensuring large and steadily growing realm income and demand and Expanding the production & trade in goods and services.

ROLE OF WTO:
WTO not only provide a platform for healthy trade in goods and services but also acts as international body involved in peace making process and focusing on other crucial areas like health care, education , unemployment, and upliftment of the

underdeveloped and developing countries while sustaining the growth of the developed nations like US, Russia etc . WTO helps member states in various ways and this enables them to reap benefits such as: Help promote peace within nations: peace is partly an outcome of two of the most fundamental principle of the trading system: helping trade flow smoothly and providing countries with a constructive and fair outlet for dealing with disputes over trade issues. Peace creates international confidence and cooperation that the WTO creates and reinforces. Disputes are handedly constructively: As trade expands in volume, in the numbers if the products traded in no. of countries and the company trading, there is greater chance that disputes will arise. The WTO help resolves theses disputes peacefully and costrcutively.if this cud is left to the member states, the disputes may lead to serious conflicts, but the lot of trade tension is reduced by organization such as WTO. Rules make life easier for all: WTO system is based on rules rather than power and this makes life easier for all trading nations. WTO reduces some inequalities giving smaller countries more voice, and at the same time freeing the major powers from the complexity of having to negotiate trade agreements with each of the member states. Free trade cuts the cost of living: Protectionism is expensive, it raises prices, and WTO lowers trade barriers through negotiation and applies the principle of non-discrimination. The result is reduced costs of production (because imports used in production are cheaper) and reduced prices of finished goods and services, and ultimately a lower cost of living. It provides more choice of products and qualities: It gives consumer more choice and a broader range of qualities to choose from.

Trade raises income: Through WTO trade barriers are lowered and this increases imports and exports thus earning the country foreign exchange thus raising the country's income. Trade stimulates economic growth: With upward trend economic growth, jobs can be created and this can be enhanced by WTO through careful policy making and powers of freer trade. Basic principles make life more efficient: The basic principles make the system economically more efficient and they cut costs. Many benefits of the trading system are as a result of essential principle at the heart of the WTO system and they make life simpler for the enterprises directly involved in international trade and for the producers of goods/services. Such principles include; non-discrimination, transparency, increased certainty about trading conditions etc. together they make trading simpler, cutting company costs and increasing confidence in the future and this in turn means more job opportunities and better goods and services for consumers. Governments are shielded from lobbying: WTO system shields the government from narrow interest. Government is better placed to defend themselves against lobbying from narrow interest groups by focusing on trade-offs that are made in the interests of everyone in the economy. The system encourages good governance: The WTO system encourages good government. The WTO rules discourage a range of unwise policies and the commitment made to liberalize a sector of trade becomes difficult to reverse. These rules reduce opportunities for corruption.

LAND MARKS OF WTO

In the year 2000 for the first time, combined output of emerging economies accounted for more than half of world GDP (in PPP) with India and china alone accounting for nearly 1/4th.The share of world exports of the emerging economies was 43% against a mere 20 % in 1970.They consumed over half of the worlds energy. The hold 70% of worlds foreign exchange reserves. The total ,merchandise goods exports of India have increased from US $ 26.33 Billion in 1994-95 to US $ 102.7 billion in 2005-06 (provisional) whereas total merchandise imports (excluding petroleum products) grew from US$ 22.72 billion to US$ 105.1 billion ( provisional) during the same period. The export of pharmaceutical products has increased from over US$ 854.51 million in 1999-2000 and to US$ 2444.06 million in 2005 -06.similarliy, Indias total commercial trade increase from US $14.06 billion in 1994 to US$ 80.58 billion.

WTO AND ENVIRONMENT

TRIPS: PATENTS AND ENVIRONMENT

Members may exclude from patentability inventions, the prevention of which within their territory is necessary to protect, amongst the objectives, human, animals or plant life or health or avoid serious prejudice to the environment. Also excluded from patentability: plants and animals other than microorganisms, as well as a essentially biological process for production of plants and animals (for ethical purposes) Members must provide for protection for the plant varieties either by patents or by effective sul genesis system or combination of two (for purpose of bio-diversity).

The WTO has no specific agreement dealing with the environment. However, the WTO agreements confirm governments right to protect the environment, provided certain conditions are met, and a number of them include provisions dealing with environmental concerns. The objectives of sustainable development and environmental protection are important enough to be stated in the preamble to the Agreement Establishing WTO. At the end of Uruguay round 1994 trade ministers from participating countries decided to begin a comprehensive work programmed on trade and environment in the WTO. They created a trade and environment committee. This has environmental and sustainable development issue into the main stream of WTO work. The 2001 Doha ministerial conference kicked off negotiations in some aspects of the subject. The committee broad based responsibility. The committee work is based on two important principles. WTO is not an environmental agency .its members do not want it to intervene in national and international environmental policies or to set environmental standards. The committee work progress focused on ten areas. it agenda is driven by proposal by individual WTO members. On issue of importance to them. The following section outlines some of the issue, and what the committee has concluded so far. The WTOs committee say the most effective way to deal with international environmental problems is through the environmental agreement include helping countries acquire environmentally friendly technology giving them financial assistance , provide training etc. A WTO DISPUTE: The shrimp turtle case: This was a case brought by India Malaysia Pakistan and Thailand against the US. The official title is united states import prohibition of certain shrimp and shrimp products, the official WTO case numbers are 58 and 61. What was all that about?

Sea turtles have been adversely by human activity either directly or indirectly. In early 1997, India, Malaysia, Pakistan and Thailand brought a joint complaint against a ban imposed by the US on the importation of certain shrimp and shrimp products. The protection of sea turtles was at heart of the ban. In the practice, Countries that had any the five species of sea turtles within their jurisdiction and harvested shrimp harvested shrimp with mechanical means, had to impose on their fishermen requirements comparable to those borne by US shrimpers if they wanted to be certified to export shrimp products to the US. The ruling In its report, the appellate body made clear that under WTO rules countries have the right to take action to protect the environment. The WTO does not have to allow them this right. The US lost the case not because it sought to protect the environment but because it discriminated between the WTO members. A GATT dispute tune dolphins dispute This case still attracts a lot of attention because of its implications for environmental disputes. It was handled under the old GATT dispute settlements procedure. ECO labeling good: if it doesnt discriminate For the WTO the key point is that labeling requirements and practices should not discriminate either between trading partners (most favored nation) should apply) or between domestically produced goods or services and imports. Transparency: information without too much paperwork

WTO members should provide as much information as possible about the environment policies they have adopted or actions they may take when these can have a significant impact on trade.

WTO AND POVERTY

A new WTO Secretariat study published today (19 June) finds that trade liberalization helps poor countries to catch up with rich ones and that this faster economic growth helps to alleviate poverty. WTO Director-General Mike Moore said: This report confirms that although trade alone may not be enough to eradicate poverty, it is essential if poor people are to have any hope of a brighter future. For example, 30 years ago, South Korea was as poor as Ghana. Today, thanks to trade led growth, it is as rich as Portugal

Extreme poverty is a huge problem. 1.2 billion People survive on less than a dollar a day. A further 1.6 billion, more than a quarter of the world's population, make do with one to two dollars a day.

To alleviate poverty, developing economies need to grow faster, and the poor need to benefit from this growth. Trade can play an important part in reducing poverty, because it boosts economic growth and the poor tend to benefit from that faster growth.

The study finds that, in general, living standards in developing countries are not catching up with those in developed countries. But some developing countries are catching up. What distinguishes them is their openness to trade. The countries that are catching up with rich ones are those that are open to trade; and the more open they are, the faster they are converging.

The study also finds that poor people within a country generally gain from trade liberalization. It concludes that "trade liberalization is generally a strongly positive contributor to poverty alleviationit allows people to exploit their productive potential, assists economic growth, curtails arbitrary policy interventions and helps to insulate against shocks". This concurs with a new World Bank study (2) which,

using data from 80 countries over four decades, confirms that openness boosts economic growth and that the incomes of the poor rise one-for-one with overall growth.

The WTO study acknowledges that some people do lose in the short run from trade liberalization. Some are well-off, others not. The report argues that the plight of the losers should not be ignored, but that the right way to alleviate their hardship is through social safety nets and job retraining rather than by abandoning reforms that benefit most people.

WTO AND AGRICULTURE

The Agreement on Agriculture started with effect from January 1, 1995. The developed countries would complete their reduction commitments within 6 years, i.e., by the year 2000, whereas the commitments of the developing countries would be completed within 10 years, i.e., by the year 2004. The products, which are included within the purview of this agreement, are what are normally considered as part of agriculture except that it excludes fishery and forestry products as well as rubber, jute, sisal, abaca and coir. SAILENT FEATURES The WTO Agreement on Agriculture contains provisions in 3 broad areas. Market Access This includes tariffication, tariff reduction and access opportunities. Tariffication means that all non-tariff barriers such as quotas, variable levies, minimum import prices, discretionary licensing, state trading measures, voluntary restraint agreements etc. need to be abolished and converted into an equivalent tariff. Ordinary tariffs including those resulting from their tariffication are to be reduced by an average of 36% with minimum rate of reduction of 15% for each tariff item over a 6 year period. Developing countries are required to reduce tariffs by 24% in 10 years. Developing countries as were maintaining

Quantitative Restrictions due to balance of payment problems were allowed to offer ceiling bindings instead of tariffication. Special safeguard provision allows the imposition of additional duties. It has also been stipulated that minimum access equal to 3% of domestic consumption in 1986-88 will have to be established for the year 1995 rising to 5% at end of the implementation period. Domestic support For domestic support policies, subject to reduction commitments, the total support given in 1986-88, measured by the total Aggregate Measurement of Support (AMS) should be reduced by 20% in developed countries (13.3% in developing countries). Policies which amount to domestic support both under the product specific and non-product specific categories at less than 5% of the value of production for developed countries and less than 10% for developing countries are also excluded from any reduction commitments. Polices which have no or at most minimal trade distorting effects on production are excluded from any reduction commitments (Green Box-Annex 2 of the Agreement on Agriculture. The list of exempted green box policies includes such policies which provide services or benefits to agriculture or the rural community, public stock holding for food security purposes, domestic food aid and certain de-coupled payments to producers including direct payments to production limiting program me, provided certain conditions are met. Special and Differential Treatment provisions are also available for developing country members. Developing countries are permitted untargeted subsidized food distribution to meet requirements of the urban and rural poor. Also excluded for developing countries are investment subsidies that are generally available to agriculture and agricultural input subsidies generally available to low income and resource poor farmers in these countries. Export Subsidies

The Agreement contains provisions regarding member's commitment to reduce Export Subsidies. Developed countries are required to reduce their export subsidy expenditure by 36% and volume by 21% in 6 years, in equal installment (from 1986-1990 levels). For developing countries the percentage cuts are 24% and 14% respectively in equal annual installment over 10 years. The Agreement also specifies that for products not subject to export subsidy reduction commitments, no such subsidies can be granted in the future.

Criticism in terms of unaddressed issues by WTO.

In order not to discredit itself, globalizations would have to squarely address sustainable development and poverty reduction. There must be an attempt to link thee strategies of development to something more fundamentals in particular .the ends of economic and social development. The international trade rules are underpinned by an insufficient appreciation of the adverse impact of rapid liberalization.., if it doesnt pay adequate attention to the need to reduce asset and income in equalities. Without substantial investment in the capacity to supply and equally important , a guaranteed safety net against falling prices and import surges , sudden liberalization will expose the constituents to unbearable risk.

India and WTO

India is a founder member of general agreements on tariffs and trade GATT 1947 and its successor the world trade organization WTO which came into effect on 1.1.95 after the conclusion Uruguay round of multilateral trade negotiations. India participation in an increasingly rule based system in the governance of international trade is to ensure more stability and predictability , which ultimately lead to more trade and prosperity for itself and 153 other nations which now comprise WTO. India automatically avails national treatment for its export to all WTO members.

Indias ranking in leading exporters and importer in world merchandise trade till 2007 is 26 & in leading exporters and importer in worlds commercial services 2007 are 9 This fourth trade policy review of India has greatly improved our understanding of Indias trade related polices and the challenges it faces in sustaining and indeed improving its ecomic growth. Members all agreed that India; ecomic performance has been impressive. BENEFITS TO INDIA The GATT Secretariat estimated that largest increase in the level of merchandise trade in goods will be in the area of clothing, agriculture, fishery and processed foods. India textile and clothing exports will increase due to the phasing out of MFA by 2005. The reduction in agricultural subsidies and barriers to export of the agricultural products, agricultural exports from India will increase. Multilateral rules and disciples related to anti-dumping subsidies and countervailing measures, safeguards & disputes settlement machinery will ensure greater predictability of international trade. It provides Market access to a number of developing countries without trade discrimination. DISADVANTAGES TO INDIA Trips agreement went against the Indian patents act 1970. Introduction of products patents in India lead to hike in drug prices by the MNCs. hence the poor will left with no generic option. Extension of intellectual property right to agriculture has negative effect on India. Indian research institutions will be unable to compete financially with MNCs will be denied access to patented genetic material.

Application to TRIMS agreement undermines any plan or strategy of self reliant growth based on local technology. Service sectors in India are backward compared to the service sectors in developed countries .hence inclusion of trade in services is detrimental to interest of India. The MFN clause proved to be detrimental to Indias interest & provided growth for Chinese invasion in Indian market through dumping.

BIBLIOGRAPHY
http://www.iisd.org/trade/handbook/toc.htm http://en.wikipedia.org/wiki/Agreement_on_TradeRelated_Aspects_of_Intellectual_Property_Rights http://en.wikipedia.org/wiki/Agreement_on_Agriculture http://www.slideshare.net/charudatta/wto-and-indian-agriculture http://www.wto.org/english/tratop_e/envir_e/edis00_e.htm http://wiki.answers.com/Q/Advantages_and_disadvantages_of_wto http://www.rediff.com/money/2005/dec/12wto2.htm www.wto.org